from the tipping-point dept

In recent months, Techdirt has reported on an important development in the world of medicine, as both India and Brazil have allowed local companies to produce cheap generic versions of drugs covered by patents. In an even bigger blow to Western pharmaceutical companies, it looks like China is following suit:

China has overhauled parts of its intellectual property laws to allow its drug makers to make cheap copies of medicines still under patent protection in an initiative likely to unnerve foreign pharmaceutical companies.

Even worse for those companies, the proposed legislation would allow Chinese generics to be sold in other countries:

For "reasons of public health", eligible drug makers can also ask to export these medicines to other countries, including members of the World Trade Organisation.

Both ACTA and TPP have clauses that would probably make that more difficult -- another reason why China is unlikely to sign up for either.

As the Reuters article quoted above explains, China has prepared this move carefully, consulting with other countries that have taken this route in order to prevent it being challenged in international forums like the WTO. It is yet another example of China moving up the production chain:

China's stable of generic drug makers has been producing the key ingredients -- or active pharmaceutical ingredients (APIs) -- in medicines for years, exporting them to foreign drug makers, which then sell the patented finished products back to China at prices which the average Chinese citizen often cannot afford.

Pharmaceutical companies in the West will doubtless fight this directly in the courts and indirectly through lobbying of their respective governments, but it's hard to see China backing down, since that would have negative consequences for the health of its citizens and entail an unacceptable loss of face.

from the urls-we-dig-up dept

Dying is usually not a pleasant eventuality, but no one has figured out how to live forever yet. So in the meantime, there are all sorts of ways for folks to bury their loved ones. Here are just a few out-of-the-ordinary ways to be laid to rest.

from the weren't-they-paying-attention? dept

The Canadian IP Council, one of the country's biggest intellectual property lobbying groups, has just released its policy roadmap (pdf) for the coming years, and the list of goals and recommendations is disturbingly ambitious. The document focuses primarily on counterfeiting and trademark issues, but its list of remedies amounts to a Canadian SOPA that would see ISPs regulated, websites blocked and personal data shared with infringement-snooping private watchdogs. Michael Geist has posted a thorough, itemized takedown of the many ridiculous assertions in the document, which is well worth reading in its entirety, but here are a few key points:

There is a recommendation for new laws adding substantial secondary liability for copyright and trademark infringement, and laws encouraging the creation of private mechanisms of cooperation between rightsholders and service providers. The stated goals of these recommendations are clear in their SOPA-esque desire that rightsholders be able to quickly and quietly shut down anything they don't like online, preferably without having to go through the courts at all:

SOPA may be dead in the U.S., but the IP lobby is anxious to revive it in Canada. SOPA targeted ISPs with website blocking as well as measures focused on payment intermediaries and online advertising networks. In addition to the quote above that even targets resolving search queries, the report states:

The existence of remedies that include blocking orders, domain seizure and contributory liability are useful tools to encourage the cooperation of intermediaries who do not wish to be involved in the illicit activity.

It adds that:

positive relationships between rights holders and these intermediaries, including online payment processors, search engines, Internet service providers, online advertisers, online retailers, web auction sites, web hosting providers, domain name system (DNS) registries and social media platforms, can provide the basis for cooperation in the prevention of counterfeit distribution. This relationship requires the support of government.

The report also asks for the criminalization of all sorts of things involving counterfeiting, but as Geist points out, what this represents is an attempt to shift all the costs of what is traditionally a private action onto the public. They want the government to enforce their IP rights for them:

The report has several recommendations that would require the government to spend millions of dollars enforcing private rights. The criminalization of intellectual property discussed above is designed to increase public enforcement of private rights. Unlike the current system, which typically requires rights holders to assert their rights through civil litigation (an approach that has recently yielded million dollar awards), the move toward criminal provisions would require government prosecutors to act on behalf on rights holders. This represents a huge enforcement subsidy. Moreover, the report recommends:

1. The government must encourage enforcement officials to seek strong remedies in the case of IPR infringements and ensure prosecutors exploit the full range of remedies available to them, including the proceeds of crime regime.

2. Develop a team of properly funded and dedicated enforcement professionals in order to effectively face the challenges presented by counterfeiting in the digital age. In the absence of such a team, it will be impossible to respond to the challenges of small shipments of counterfeit product delivered online, and Canada will not be effectively positioned to partner with our international counterparts in tackling multinational operations.

3. Create an interagency intellectual property council consisting of senior officials from various government departments, including the Department of Justice and the RCMP, with the mandate to develop public education programs, initiatives for law enforcement and policy.

4. Establish a specialized IP crime task force to guide and lead anti-counterfeiting and anti-piracy enforcement efforts in Canada.

The creation of new agencies, task forces, enforcement teams, and education programs are all part of a systemic effort to shift costs to the public.

The document also leans heavily on ACTA, often misrepresenting its recommendations as requirements, and ignoring the fact that ACTA is facing significant backlash in the EU. In America, the SOPA protests and the growing internet movement have succeeded in getting a lot of intellectual property groups to back off from their most draconian requests for things like website blocking—but such is apparently not the case in Canada, if the IP Council isn't even the least bit bashful about pushing such an extreme position.

from the bad-laws dept

You may remember that, a couple months ago, Colombia rushed through its own version of a SOPA-like copyright law. The details were particularly horrifying. Last fall, the US and Colombia signed a "free trade agreement" (FTA). Tragically, like many FTAs put together by the USTR these days, it included something that's the very opposite of "free trade": a requirement to put in place extraordinary protectionist measures in the form of expansive copyright laws. In order to be in compliance with the treaty, Colombia had to pass some really bad legislation. Its first attempt, a few months earlier, failed when the public spoke up. However, in April, President Obama came to visit Colombia on a very high-profile trip. In order to make him happy, the Colombia government rushed through a ridiculously bad copyright bill, making it law with almost no public discourse. Not surprisingly, the bill is terrible.

Thankfully, two Senators have now filed lawsuits challenging the law, saying that it violates privacy rights and limits freedom of access to information. Oh yeah, and it violates the Colombian constitution. The serious problems with the bill had been raised with the Colombian government prior to it passing, but in their rush to make Obama happy, apparently they didn't care.

from the crowdfunding-justice dept

Francisco sent over an interesting story of how a bunch of people in Spain were able to crowdfund a bunch of money in an attempt to bring Rodrigo Rato, the former chair of one of Spain's largest banks, Bankia, to justice for driving the bank into the ground until it had to be bailed out. In just one day, they were able to blast past the €15,000 they were seeking.

I have to admit that I'm interested in this as an outlet for populist outrage, but I do wonder how effective it really is. An English version of the site claims they plan "criminal and civil actions against members of Bankia's Board of Directors," and they "demand prison and seizure of assets." While they can file civil claims, criminal charges have to come from the government. So the goal is to use the money not just for filing a civil suit, but also to hire independent investigators and auditors to work towards building enough details and evidence that it forces the government to file criminal charges as well. This seems like a project that has a ridiculously high likelihood of failure.

Separately, while I tend to agree that the banks were run by some insanely greedy people who did many questionable things, I think it's going a little mob-like "burn him!" crazy to try to pin the problems on a single person. The global economy is still a mess, and the European economy is in turmoil, with Spain being a big part of that. In other words, there are larger economic issues at play here that go beyond just one banker, even if it turns out that he was a really bad banker.

Either way, though, I am fascinated to see how crowdfunding evolves over time, and the unique ways people use it -- and this is certainly a unique plan.

from the *sigh* dept

So, back in April we wrote about a bizarre report from the US Commerce Department and the US Patent and Trademark Office, which tried to sum up the "jobs" in "IP-intensive" industries, as a measure of how important those laws were. As we noted last week, the White House reached out to us and offered up the experts behind the report for an interview -- but when we submitted some questions (as they asked us to do prior to setting up the final interview), they suddenly rescinded that offer and offered up this bizarre and nonsensical statement about how Steve Jobs had lots of patents and Steve Jobs created cool products, so patents are important. They did nothing to refute the insane methodology of the study that attributes all of the jobs of people working in grocery stores, insurance companies, clothing stores and more to "IP intensive industries." Nor do they explain why the report is useful in suggesting why we need more copyright laws to protect all those jobs -- when copyright really barely touches on any of the jobs in the list.

Instead... they focus on this bizarre Steve Jobs example.

All evidence suggests that patents continue to drive innovation in technology. At the time of his death, innovator Steve Jobs had more than 300 patents. Companies such as Apple have made transformative changes in our lives, made possible by massive investments made by intellectual property. But while such companies develop brand-new technologies and services, they also perform incremental innovation. Thus, IP conflicts arise as the byproducts of a very healthy overall innovation environment. The tech industry is characterized by extremely sharp drops in costs over time, extremely strong increases in performance, and multiple changes in market leads, with different companies leading at different points in time. That tremendously competitive marketplace is a sign of the critical role IP rights play in driving technology companies to invest, compete, create jobs, and drive exports.

Of course, as a friend pointed out, since the report covers trademarks, copyright and patents, it's a little strange that they focused solely on patents in their "defense" of the report. After all, as the "grocery store" discussion points out, the vast, vast majority of the "jobs" counted in the report are related to trademarks. And, so far, nearly all of the policy efforts that are highlighting the report are around copyright issues.

Oh, and then there's this:

That's figure 2 from this very same report. And, as you might notice, it seems to show that, on an indexed basis, jobs in "patent intensive" industries have been on the decline relative to everything else. In fact, it seems to suggest that since about 1998 (hmmm... right at the point in which the Federal Circuit appeals court deemed software patentable in the infamous State Street case), relative employment in patent-intensive industries has gone down. Pretty massively.

Lets add to it another chart, one we published a year and a half ago, put together by the folks at Patently-O.

Note the big jump in patents in 1998, and the continued growth all the while jobs in "patent-intensive industries" seemed to be on the decline? Yeah. Isn't that interesting?

Yes, these are also correlation figures, possibly not causal. But the correlation can be useful in showing that something doesn't add up from the story (it's not so useful for explaining causation, but rather just for indicating that a causal relationship doesn't appear to be present). So it seems even more bizarre and more questionable that the Commerce Department is waving around "Steve Jobs had patents" as the defense of the report -- when the data from their own report doesn't even seem to agree with their own conclusion.

from the really-now? dept

One of the more bizarre things that we see in the debate over "piracy" is that when we ask people what's more important -- stopping piracy or making more money -- there are some who actually argue that stopping piracy is more important. I have to admit that I can't get my head around this concept, but apparently it extends even beyond the issue of "piracy" to the issue of pricing as well. vegetaman points us to an absolutely bizarre interview with the head of EA's Origin platform, David DeMartini, in which he's asked by GamesIndustry.biz how he feels about Valve's regular deep discounting of games, something we've discussed at length before. DeMartini is not impressed, claiming that it cheapens your intellectual property:

We won't be doing that. Obviously they think it's the right thing to do after a certain amount of time. I just think it cheapens your intellectual property. I know both sides of it, I understand it. If you want to sell a whole bunch of units, that is certainly a way to do that, to sell a whole bunch of stuff at a low price. The gamemakers work incredibly hard to make this intellectual property, and we're not trying to be Target. We're trying to be Nordstrom. When I say that, I mean good value - we're trying to give you a fair price point, and occasionally there will be things that are on sale you could look for a discount, just don't look for 75 percent off going-out-of-business sales.

Except that totally ignores the reality of the situation and suggests big trouble for the way EA does business. As Valve has made clear, when it does those deep discounts, the increase in sales greatly surpasses the revenue made prior to those discounts. That's not a "going out of business" sale. It's a "let's make a hell of a lot more money" sale.

I'm honestly at a complete loss here. DeMartini literally seems to be claiming that making less money is a better business strategy because it doesn't "cheapen your intellectual property." Apparently the man is entirely unfamiliar with price elasticity, and how lowering your price can lead to more revenue (something which most people think is a good thing). So here's a case where we aren't even talking about "piracy," but instead DeMartini's assessment of what games must be priced at -- and against what the market says is the profit maximizing price. In what world is it a smart business strategy to keep prices high if it's guaranteed to make you less money... all because you want some perceived "value" to be higher, even if fewer people want to buy it?

from the censorship dept

While the public got reasonably upset about SOPA's overreach, and the possibility that it would be used to shut down websites with no due process, what they miss is that the federal government has been pretending that it already has that right under the last change to copyright law -- the ProIP Act (not the same as the Protect IP Act, which was the Senate's counterpart to SOPA). The ProIP Act was filled with a ton of bad ideas. An outcry (much smaller than SOPA) at least stopped some of the very very worst parts of the original ProIP Act from being enacted, but there were still plenty of "easter eggs" from the entertainment industry. One of them was the expansion of "civil forfeiture proceedings," to also cover:

(1) CIVIL FORFEITURE PROCEEDINGS-

(A) The following property is subject to forfeiture to the United States:

' (i) Any copies or phonorecords manufactured, reproduced, distributed, sold, or otherwise used, intended for use, or possessed with intent to use in violation of section 506(a) of title 17, any plates, molds, matrices, masters, tapes, film negatives, or other articles by means of which such copies or phonorecords may be made, and any electronic, mechanical, or other devices for manufacturing, reproducing, or assembling such copies or phonorecords.

`(ii) Any property constituting or derived from any proceeds obtained directly or indirectly as a result of a violation of section 506(a) of title 17.

`(iii) Any property used, or intended to be used, to commit or facilitate the commission of a violation of section 506(a) of title 17 that is owned or predominantly controlled by the violator or by a person conspiring with or aiding and abetting the violator in committing the violation, except that property is subject to forfeiture under this clause only if the Government establishes that there was a substantial connection between the property and the violation of section 506(a) of title 17.

`(B) The provisions of chapter 46 relating to civil forfeitures shall extend to any seizure or civil forfeiture under this section.

This was tucked in at the very end of the bill, and it's almost too clever for its own good. Notice how part (i) talks about "phonorecords" and them being "manufactured" and such. That quickly gets people thinking that this is merely about extending seizure and forfeiture laws to things like CD and DVD burners. In fact, when I asked about this particular section back in 2007, I was told exactly that: that it had little to do with the internet, but was really about seizing disc burners. The only areas where they were talking about the internet was in cases involving hard drives full of infringing material.

The idea that criminal forfeiture provisions, drafted to reach major drug traffickers like the Columbian cartels, should be inserted into civil copyright tort provisions with a preponderance of the evidence burden, is mind-blowing. The capacity – if not intent – of these provisions for profound mischievousness is obvious: in addition to the gluttonous statutory damages that would be available, content owners now want to defendants to forfeit their computers, their cars, and their homes: all of these can be said to have been used in the commission of infringement (say defendant uses his phone to call someone else involved in the infringement and says “meet me at 11 at Moe’s).

But the bill goes even further: it is not only property actually used that is subject to forfeiture, property that wasn’t used but was “intended to be used” can also be seized. Say, a defendant intended to use his car to transport a computer used in connection with infringement, civil infringement, but decided to take his wife’s car instead. Under the bill, both cars, the computer, and the house where the cars and the computer are stored can be forfeited. But there is more: the bill also includes property “derived from any proceeds obtained directly or indirectly” as result of civil infringement. A television, children’s toy, anything that a defendant owns could fall within this: how could one disprove that any property purchased in the relevant time period was not indirectly derived from infringement. Is even gluttony enough to describe this?

But here's the thing: Patry underestimated how this would be used. He expected it would be used to harass people by seizing other physical property. He never imagined that it would be used to censor websites by "seizing" their domains. No one discussed that at all. In retrospect, however, it now seems clear that this was the intent all along. This little section was a big part of why the entertainment industry wanted ProIP so badly -- and it likely put in some of the other ridiculous ideas to throw people off the scent. If so, it worked.

Not long after ProIP was officially signed into law, Immigrations and Customs Enforcement (ICE), a division of Homeland Security, in partnership with the Justice Department, began one of the most shameful operations by the US government: a widespread campaign to seize and censor websites, pointing to this clause as the "legal cover," despite the fact that such censorship is almost certainly a violation of both the 1st and 5th Amendments. Called "Operation in Our Sites," ICE has been seizing (and in some cases forfeiting -- which, in this context, means keeping, as "seizure" is supposed to be a temporary process) website URLs on very little legal basis, without any adversarial hearing -- indeed, without even providing notice to those who own the sites often until weeks or months later. This began in June of 2010, with ICE announcing its first round of illegal seizures directly from Disney's headquarters, not even trying to hide that they were censoring websites at the urging of Hollywood. As we said at the time, imagine the outcry if the FTC announced Google antitrust charges from Microsoft's headquarters. People would go nuts.

Of course, as we've since learned, the whole process was corrupt. In one case, that of hiphop blog Dajaz1, the Justice Department refused to let the site have its day in court, passing a series of totally secret "extensions" while waiting for the RIAA to provide "evidence" it never could provide (because it didn't exist). Eventually, after having shut down and censored a publication for over a year, the government quietly just handed the domain back without even so much as an apology. To this day, the Justice Department has been dodging questions about this domain.

And while Dajaz1 gets most of the attention, it's worth remembering that over 700 websites have been illegally censored in this manner, and we don't know how many of them are trying to get their domains back, because the government continues this very secretive process. In fact, from what we do know, two other websites that were seized in the same round as Dajaz1 and have been trying to get their domains back ever since are still being held hostage by the government. Yes, these sites have been censored for over a year and a half now.

For all the talk and worries about SOPA, it's important to realize that the thing people were most scared about -- that the law would be used to censor websites the entertainment industry just doesn't like -- is already a reality, and it came via ProIP and is happening now under the name "Operation In Our Sites."

Last week, a White House petition was set up, calling for the White House to put an end to Operation In Our Sites. To date, the administration has done everything possible to hide from the fact that it's censoring websites, while playing up claims that it's "stopping piracy." This needs to stop. Signing the petition is one step in making that happen, along with actually holding the White House responsible for the fact that it is censoring and shutting down websites, even while it's telling the rest of the world that they need to stop censoring the web.

Please pass the story around to others, so that they recognize what's already being done by the US government to censor websites under the guise of copyright law.

from the tilting-at-windmills dept

British glam-rock band The Sweet (best known for songs like Block Buster! and The Ballroom Blitz) seemed pretty damn bitter five years ago when guitarist Andy Scott sued an Austrian man, Dietmar Huber, for selling a single used CD on eBay at a price of one euro. At first, he claimed it was a pirated copy and asked for a €2000 fee, but Huber refused, insisting it was a legally purchased disc that he had every right to sell. Amazingly, Scott kept pushing, and went to court asking for €36,000. When Huber proved in court that it was his CD, Scott still didn't give up! He changed his claim to say he owned a copyright on the name, and all used sales had to be authorized by him.

This isn't really surprising—most jurisdictions recognize that it's always okay to re-sell something you legally purchased. Of course, we do see some companies pushing back against this, most notoriously video game developers. But even they'd (probably) be smarter than to engage in such a Quixotic legal quest. And that's the surprising part here: that the guitarist kicked off this circus and forced it to keep escalating. Used records have been a much-loved part of the music world for decades—did he think he was going to change all that? More importantly, does he think this is going to help him sell more albums? In reality, I'd guess people are going to be a lot more reluctant to buy a Sweet CD in the future, since they know they might get sued if they want to re-sell it later (because, given his dogged pursuit of this dead-end lawsuit, I am not optimistic that Scott has learned his lesson).

from the indeed dept

We just mentioned the charade happening down in Australia, where the entertainment industry, the government and some ISPs are meeting in total secrecy to try to hash out a "voluntary" plan to deal with online infringement. Of course, not only won't any agreement work, the whole process is stupid. Thankfully, at least one ISP is publicly speaking out about this: iiNet.

Of course, to some extent, iiNet is "responsible" for these meetings happening at all. If you don't recall, iiNet was chosen carefully by a Hollywood-run front group in Australia called AFACT -- the Australian Federation Against Copyright Theft -- because the Hollywood studios thought that it was big enough to matter, but too small to actually fight back. They miscalculated. iiNet fought back (strongly) and won easily at multiple levels, leading to a nice precedent on the books that Hollywood hates. Of course, part of that ruling more or less said that iiNet had no responsibility to do anything under existing law. So now that's resulted in these meetings, in which the government hopes "an agreement" is reached, but where it also gets to suggest that if the ISPs don't appease Hollywood, regulations might be put in place.

iiNet, being at the center of all this, finds the entire thing ridiculous and is not shy about stating how it really feels, saying that negotiating with Hollywood is like talking to a brick wall. The blog post from iiNet covers a lot of ground that we've covered here for years, but it's nice to see an ISP speak out so publicly and so strongly on these points. First off, it covers the real problem: there's real consumer demand, but the industry sucks at meeting it. It also debunks the "can't compete with free" trope, yet again.

AFACT and other rights holder bodies don’t care much for consumers. As you may have read, Neil Gane of AFACT thinks consumers are “unreasonable” to tell their suppliers of entertainment what they want. Actually, AFACT don’t have any customers in Australia, they are all in California, which unfortunately means that consumer pressure is unlikely to have much impact on their strategies.

iiNet have suggested that they focus on what the market is demanding, but it’s a waste of breath. Their masters have set the agenda and rights holders will only do their bidding.

Gane has made repeated calls for legislative change over time and that’s where AFACT’s future efforts will focus on, not taking into account consumer demands. The attorney general’s departmental forum is not designed to contribute to such legislative change and so I’m not expecting the process to generate any satisfaction for consumers or distributors.

Listening to actual consumers would be tremendously helpful, but the inability of the entertainment industry to do exactly that is a big part of the reason they're in this mess today in the first place.

from the got-that? dept

Joe Betsill points us to the news that Barnes & Noble is the latest to weigh in on the price-fixing case against Apple and some publishers over ebook pricing. It's really bizarre. At best, it can be summed up as "we have to stop Amazon from offering cheap books, because if they do that, then we (Barnes & Noble) might go out of business, and then Amazon would be all alone and it might raise prices." Yes, the argument is that we're better off having expensive ebooks today, because if we don't, we might have expensive books in the future. I'm still trying to figure out how that makes any sense. At all.